Trade Treaties in Trouble

Juncker Merkel DPA
Angela Merkel and European Commission President Jean Claude Juncker yesterday in Brussels. Merkel said she opposed Juncker's plan to adopt TTIP and CETA -- controversial trade pacts with the U.S. and Canada -- without public votes in each E.U. country.
  • Why it matters

    Why it matters

    If parliaments refuse to ratify them, trade treaties between the European Union, Canada and the United States may not be agreed upon this year.

  • Facts


    • Some hoped the TTIP, the Transatlantic Trade and Investment Partnership agreement on free trade between the E.U. and the U.S., could be agreed this year but it is unpopular in many European countries.
    • CETA, the trade treaty between Canada and the European Union, was agreed in August 2014 but it is unclear whether it needs to be approved by all the national parliaments in the E.U.
    • Unilateral agreements do not need the approval of the member states’ national parliaments but mixed agreements do.
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One of the first victims of last week’s Brexit vote could be the proposed transatlantic trade pacts between the European Union and Canada and the United States. At least, the chances for both seemed to dim on Tuesday after the European Commission moved to adopt the controversial agreements without a public vote.

The proposal by European Commission President Jean Claude Juncker would have the commission adopt by a vote of the 28-member countries the so-called TTIP and CETA proposed agreements with the United States and Canada. But Mr. Juncker’s plan — a defiant power grab in the wake  of the Brexit vote — may prove politically unacceptable for E.U. members wary of further alienating right-wing populist movements.

German Chancellor Angela Merkel said she opposed Mr. Juncker’s plan to adopt the agreements directly without public votes in the parliaments or referenda in the 28 countries. The Juncker plan seemed to reflect fear that some E.U. countries would likely reject the agreements in national votes in the wake of Brexit.

On Tuesday evening, Mr. Juncker had told E.U. leaders that the trade treaty between Europe and Canada need not be ratified by each of the bloc’s national parliaments.

However Ms. Merkel, also in Brussels to meet outgoing British Prime Minister David Cameron, insisted that Germany must put the pacts to a vote in the Bundestag. Both agreements face an uphill battle in Germany, where interest groups have rallied opposition to deals they claim will reduce national health and safety standards.

Vice chancellor Sigmar Gabriel called Mr. Juncker’s remarks “unbelievably foolish” in an interview with German daily newspaper Tagesspiegel. He warned that if the European Commission were to push through CETA, TTIP would be dead. Mr. Gabriel worries that given the current mood in Europe, people would focus more on the fact that national parliaments aren’t involved than on CETA itself, if it were to be ratified only by the Commission.

Fears are growing that popular opposition to the treaties could block the European Union’s scope to proceed in the trade agreements.

“The problem now is that the public has woken up to these agreements,” Professor Lorand Bartels, an expert in international law and trade treaties at the university of Cambridge, told Handelsblatt Global Edition. “Now, parliaments have to be seen to listen to the people. That’s what’s changed,” he said.

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